SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
[ X ] Filed by the registrant
[ ] Filed by a party other than the registrant
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[ X ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss. 240.14a-11(c) or ss. 240.14a-12
FIRST REAL ESTATE INVESTMENT TRUST OF NEW JERSEY
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(Name of Registrant as Specified in Its Charter)
<PAGE>
PROXY STATEMENT
FIRST REAL ESTATE INVESTMENT TRUST OF NEW JERSEY
505 Main Street, P.O. Box 667
Hackensack, New Jersey 07602
NOTICE OF ANNUAL MEETING OF HOLDERS
OF SHARES OF BENEFICIAL INTEREST
APRIL 12, 2000
TO THE HOLDERS OF SHARES OF BENEFICIAL INTEREST OF
FIRST REAL ESTATE INVESTMENT TRUST OF NEW JERSEY
The Annual Meeting of the holders of shares of beneficial interest (the
"Shareholders") of First Real Estate Investment Trust of New Jersey (the
"Trust") will be held on Wednesday, April 12, 2000, at the Trust's executive
offices, 505 Main Street, Hackensack, New Jersey at 7:30 p.m., Eastern Daylight
Savings Time, for the following purposes:
1. To elect one (1) Trustee, for a term of three years or until his
successor has been elected and qualify;
2. To transact such other business as may properly come before the
meeting or any adjournment thereof.
The Shareholders of record at the close of business on February 23,
2000 are entitled to notice of and to vote at the meeting.
/s/WILLIAM R. DELORENZO,JR.
---------------------------
WILLIAM R. DELORENZO,JR.
Executive Secretary
Hackensack, New Jersey
February 23, 2000
YOU ARE CORDIALLY INVITED TO ATTEND THE MEETING. TO ENSURE YOUR REPRESENTATION
AT THE MEETING, HOWEVER, YOU ARE URGED TO SIGN AND DATE THE ACCOMPANYING PROXY
AND MAIL IT AT ONCE IN THE ENCLOSED ENVELOPE. PROMPT RESPONSE IS HELPFUL AND
YOUR COOPERATION WILL BE APPRECIATED.
<PAGE>
FIRST REAL ESTATE INVESTMENT TRUST OF NEW JERSEY
PROXY STATEMENT
General Information
This Proxy Statement is furnished to the holders (the "Shareholders")
of shares of beneficial interest without par value (the "Shares") of First Real
Estate Investment Trust of New Jersey (the "Trust") in connection with the
solicitation of proxies for use at the annual meeting of the Shareholders to be
held on April 12, 2000, and any adjournment thereof (the "Annual Meeting"),
pursuant to the accompanying Notice of Annual Meeting of Holders of Shares of
Beneficial Interest. Beneficial interests in the Trust are represented by the
Shares, and the Shares are the only authorized, issued and outstanding class of
equity of the Trust. A form of proxy for use at the Annual Meeting is also
enclosed. The Trust anticipates mailing this Proxy Statement to its Shareholders
beginning on March 10, 2000. The executive offices of the Trust are located at
505 Main Street, Hackensack, New Jersey 07601.
Shareholders may revoke the authority granted by their execution of
proxies at any time before the effective exercise of proxies by filing written
notice of such revocation with the Secretary of the Annual Meeting. Presence at
the Annual Meeting does not of itself revoke the proxy. All Shares represented
by executed and unrevoked proxies will be voted in accordance with the
instructions therein. Proxies submitted without indication will be voted FOR the
nominee for Trustee named in this Proxy Statement. The Board of Trustees of the
Trust (the "Board of Trustees") is not aware, at the date hereof, of any matters
to be presented at the Annual Meeting other than the matters described above but
if any other matter incident to the Annual Meeting is properly presented, the
persons named in the proxy will vote thereon according to their best judgment.
The cost of preparing, assembling and mailing the proxy material is to
be borne by the Trust. Proxies for use at the Annual Meeting are being solicited
by the Board of Trustees. It is not anticipated that any compensation will be
paid for soliciting proxies and the Trust does not intend to employ specially
engaged personnel in the solicitation of proxies. It is contemplated that
proxies will be solicited principally through the mail. Members of the Board of
Trustees and executive officers of the Trust ("Executive Officers") may also,
without additional compensation, solicit proxies, personally or by mail,
telephone, telegraph, facsimile transmission or special letter.
Voting Securities
The only voting securities entitled to vote at the Annual Meeting are
the Shares. Each Share entitles its owner to one vote on an equal basis. The
number of outstanding Shares on February 23, 2000 was 1,559,788. Only
Shareholders of record on the books of the Trust at the close of business on
that date will be entitled to notice of and to vote at the Annual Meeting. The
holders of a majority of the outstanding Shares, present in person or
represented by proxy, will constitute a quorum at the Annual Meeting.
Abstentions and broker non-votes will be counted for purposes of determining
whether a quorum is present at the Annual Meeting.
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<PAGE>
Trustees are elected by a plurality of the votes cast at the Annual
Meeting by the holders of Shares present in person or represented by proxy and
entitled to vote. The proxy card provides space for a Shareholder to withhold
votes for the nominee to the Board of Trustees.
All votes will be tabulated by the inspector of election appointed for
the Annual Meeting who will separately tabulate affirmative votes, negative
votes, authority withheld for the nominee for Trustee, abstentions and broker
non-votes. Any proxy submitted and containing an abstention or a broker non-vote
will not be counted as a vote cast on any matter to which it relates.
Security Ownership of Certain Beneficial Owners and Management
The following table sets forth information, as of February 23, 2000,
with respect to beneficial ownership, as defined in Rule 13d-3 of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), of beneficial interests
in the Trust, as represented by the Shares, for each Trustee, nominee for
Trustee, and Executive Officer of the Trust. The only persons who beneficially
own five percent (5%), or more, of the Shares are four (4) Trustees named in the
table below.
Amount and Nature of Beneficial Ownership (Columns A, B & C)
<TABLE>
<CAPTION>
(A) (B) (C)
Shares Currently Options Total Percent of
Name of Beneficial Owner Owned (1) Exercisable (2) (A & B) Class
- ------------------------ --------- --------------- ------- -----
<S> <C> <C> <C> <C>
Robert S. Hekemian (3) 71,951 (5) 28,000 99,951 6.3%
Donald W. Barney (3) 51,553 (6) 28,000 79,553 5.0%
John B. Voskian, M.D.(3) 97,735 (7) 16,000 113,735 7.2%
Herbert C. Klein, Esq. (8) 59,378 (9) 28,000 87,378 5.5%
Nicholas A. Laganella (4) 3,625 15,000 18,625 1.2%
Ronald J. Artinian (8) 98,929 (11) 18,000 116,929 7.4%
Alan L. Aufzien (8) 1,500 6,500 8,000 (10)
William R. DeLorenzo, Jr., Esq
(12) 3,763 13,000 16,763 1.1%
------- ------- ------- ----
388,434 152,500 540,934 32.1%
======= ======= ======= =====
</TABLE>
All Trustees, Nominee for
Trustee and Executive Officers
as a group (8 persons)
(1) Except as otherwise indicated, all of the Shares are held beneficially
and of record.
(2) Shares subject to currently exercisable Options granted under the
Equity Incentive Plan.
<PAGE>
(3) A Trustee and Executive Officer of the Trust.
(4) Mr. Nicholas A. Laganella is retiring from the Board of Trustees
effective April 12, 2000.
(5) Includes 18,598 Shares held by Mr. Hekemian's wife, with respect to
which Mr. Hekemian disclaims beneficial ownership. Also includes (i)
18,368 Shares contributed to the Hekemian & Co., Inc. Pension Plan of
which Mr. Hekemian is a trustee and a participant, (ii) an aggregate of
26,341 Shares which are held by certain partnerships in which Mr.
Hekemian is a partner, and (iii) 3,549 Shares held in certain trusts
for which Mr. Hekemian is a trustee and one trust in which Mr. Hekemian
is a beneficiary, with respect to which Mr. Hekemian disclaims
beneficial ownership except to the extent of his pecuniary interest in
the pension plan, partnerships and trusts.
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<PAGE>
(6) Includes 11,732 Shares held by Mr. Barney's wife and 3,440 Shares which
are held in a trust for Mr. Barney's daughter of which Mr. Barney is
the trustee, with respect to which Mr. Barney disclaims beneficial
ownership.
(7) Includes 8,694 Shares held by Dr. Voskian's wife and 1,688 shares which
Dr. Voskian holds as custodian for the benefit of his daughter, with
respect to which Dr. Voskian disclaims beneficial ownership. Also
includes an aggregate of 87,353 Shares held in various trusts for which
Dr. Voskian or his wife is trustee, with respect to which Dr. Voskian
disclaims beneficial ownership.
(8) A Trustee of the Trust.
(9) Includes 6,938 Shares held by Mr. Klein's wife and 4,250 Shares held in
a trust for the benefit of Mr. Klein's son of which Mr. Klein's wife is
trustee, with respect to which Mr. Klein disclaims beneficial
ownership.
(10) Shares beneficially owned do not exceed one percent (1%) of the Trust's
issued and outstanding Shares.
(11) Includes 23,762 Shares which are in a family trust with respect to
which Mr. Artinian disclaims beneficial ownership except to the extent
of his pecuniary interest in such trust. Also includes 900 Shares which
are held by Mr. Artinian as custodian for the benefit of his son, with
respect to which Mr. Artinian disclaims beneficial ownership.
(12) An Executive Officer of the Trust.
ELECTION OF TRUSTEES
(Item 1 on Proxy Card)
The Trust is governed by the Board of Trustees. The Declaration of
Trust provides that the Board of Trustees will consist of not fewer than five
(5) nor more than nine (9) Trustees.
During Fiscal year 1999 the Board of Trustees consisted of eight (8)
members including Mr.Charles J. Dodge who passed away on February 19, 2000. As a
result, the Board of Trustees currently consists of seven (7) members.
The terms of two (2) of the Trustees expire at the Annual Meeting. The
Nominating Committee recommended to the Board of Trustees that only one Trustee
position be filled.
As a result, the Board of Trustees will consist of no more than six (6)
members for the present. Each Trustee is elected for a term of three (3) years.
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<PAGE>
Nominee
The Board of Trustees nominated Herbert C. Klein for election at the
Annual Meeting to three (3) year term as a Trustee to commence at the Annual
Meeting consistent with the recommendation of the Nominating Committee.
Mr. Klein is currently a member of the Board of Trustees whose term
expires on the date of the Annual Meeting. Please see the section of this Proxy
Statement captioned "Board of Trustees" for a description of the business
experience of and other relevant information with respect to Mr. Klein.
It is the intention of the persons named in the accompanying proxy to
vote, unless otherwise instructed, in favor of the election of the nominee named
above as Trustee. If Mr. Klein should be unable to serve, the proxies will be
voted for the election of such other person or persons as shall be determined by
the persons named in the proxy in accordance with their judgment. Management of
the Trust is not aware of any reason why Mr. Klein, as the nominee, if elected,
would be unable to serve as a Trustee.
The Board of Trustees recommends a vote "FOR" Mr. Herbert C. Klein the
nominee for Trustee.
Board of Trustees
The members of the Board of Trustees of the Trust are:
<TABLE>
<CAPTION>
Year First Elected to the
Name Age Board of Trustees
- ---- --- -----------------
<S> <C> <C>
Robert S. Hekemian 68 1980
Donald W. Barney 59 1981
John B. Voskian, M.D. 75 1968
Herbert C. Klein, Esq. 69 1961
Nicholas A. Laganella 81 1969
Ronald J. Artinian 51 1992
Alan L. Aufzien 70 1992
</TABLE>
Robert S. Hekemian has been active in the real estate industry for more
than forty-six (46) years. Mr. Hekemian has served as Chairman of the Board of
the Trust since 1991, and as a Trustee since 1980. His current term as a member
of the Board of Trustees is scheduled to expire in April 2002. From 1981 to
1991, Mr. Hekemian was President of the Trust. Mr. Hekemian devotes
approximately twenty-five percent (25%) of his time to execute his duties as an
Executive Officer of the Trust. Since 1983, Mr. Hekemian has also been the Chief
Executive Officer and Chairman of the Board of Hekemian & Co., Inc., a real
estate brokerage and management company which manages the Trust's properties
("Hekemian & Co."). See the section captioned "Certain Relationships and Related
Party Transactions" in this Proxy Statement. Mr. Hekemian is a director of
Summit Bank. He is also a director, partner and officer in numerous private real
estate corporations and partnerships. Mr. Hekemian is the brother-in-law of Dr.
Voskian.
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<PAGE>
Donald W. Barney has served as President of the Trust since 1993, and
as a Trustee since 1981. His current term as a member of the Board of Trustees
is scheduled to expire in April 2001. Mr. Barney devotes approximately ten
percent (10%) of his time to execute his duties as an Executive Officer of the
Trust. Mr. Barney was formerly associated with Union Camp Corporation, a
diversified manufacturer of paper, packaging products, chemicals and wood
products, and until December 31, 1998, as Vice President and Treasurer. Mr.
Barney was a director of Ramapo Financial Corporation until May 1999 when the
corporation merged with another financial institution. Mr. Barney is also
partner and director in several other private real estate investment companies.
Mr. Barney was formerly the brother-in-law of Mr. DeLorenzo.
Dr. John B. Voskian has served as Secretary and a Trustee of the Trust
since 1968. His current term as a member of the Board of Trustees is scheduled
to expire in April 2002. Dr. Voskian spends less than five percent (5%) of his
time with respect to his duties as an Executive Officer of the Trust. A
physician, Dr. Voskian has retired from the practice of medicine. Dr. Voskian is
also a director and an officer of a number of private real estate companies. Dr.
Voskian is the brother-in-law of Mr. Hekemian.
Herbert C. Klein, Esq. has served as a Trustee since 1961. His current
term as a member of the Board of Trustees expires in April 2000. Mr. Klein has
been nominated for election to another three (3) year term as a Trustee. From
1991 through the end of 1992, Mr. Klein served as President of the Trust. Mr.
Klein has been an attorney since 1956 with a practice devoted to real estate,
corporate matters and government relations. From March 1995 to January 1999, Mr.
Klein was a director of the law firm of Hannoch Weisman located in Roseland, New
Jersey. In January 1999, Mr. Klein became a partner in the law firm of Nowell
Amoroso Klein Bierman P.A., with offices located in Hackensack, New Jersey and
New York City. See section captioned "Certain Relationships and Related Party
Transactions" in this Proxy Statement. From January 1993 to January 1995, Mr.
Klein was a member of the United States Congress, House of Representatives, for
the 8th Congressional District of New Jersey. Mr. Klein is also a former member
of the New Jersey Legislature.
Nicholas A. Laganella has served as a Trustee since 1969. His current
term as a member of the Board of Trustees expires in April 2000.
The Trust Agreement, as amended, provides that no Trustee is eligible
for election as a Trustee after the age of 75. As a result, Mr. Laganella was
not nominated for an additional term as a Trustee.
Ronald J. Artinian has served as a Trustee since 1992. His current term
as a member of the Board of Trustees is scheduled to expire in April 2001. From
1989 to 1998, Mr. Artinian was an investment banker with Smith Barney, Inc.,
including positions as a Managing Director and National Sales Manager. Smith
Barney is now Salomon Smith Barney Holdings, Inc., a subsidiary of Citigroup
Inc. Mr. Artinian retired from Smith Barney in January 1998 in order to pursue
other business interests as a private investor.
-5-
<PAGE>
Alan L. Aufzien has served as a Trustee since 1992. His current term as
a member of the Board of Trustees is scheduled to expire in April 2001. Since
1986, Mr. Aufzien has been Chairman and Managing Partner of the Norall
Organization, an investment company. From 1980 to 1998, Mr. Aufzien was a
partner in the Meadowlands Basketball Association, t/a New Jersey Nets (Member
of the National Basketball Association), and was its Chairman and Chief
Executive Officer, and then its Secretary and Treasurer, as well as a member of
its Board of Directors. Since 1986, Mr. Aufzien has also been the Chairman and
Chief Executive Officer of New York Harbour Associates, a real estate developer.
Mr. Aufzien is a director of Rent A Wreck of America, Inc.
Meetings of the Board of Trustees: Committees
During the fiscal year ended October 31, 1999, the Board of Trustees
held seven (7) meetings. The Board of Trustees has two (2) standing committees:
the Executive Committee and the Audit Committee. During fiscal 1999, each member
of the Board of Trustees attended more than 75% of the aggregate number of (i)
meetings of the Board of Trustees and (ii) meetings of the committees of the
Board of Trustees on which each trustee served except for Mr. Nicholas
Laganella. Mr. Laganella did not attend two (2) of the seven (7) Board of
Trustees Meetings. The Executive Secretary of the Trust, William R. DeLorenzo,
Jr., attends meetings of the Board of Trustees and each of its committees in a
nonvoting capacity.
(a) Executive Committee
The current members of the Executive Committee of the Board of Trustees
(the "Executive Committee") are Robert S. Hekemian, Donald W. Barney, Ronald J.
Artinian, and Herbert C. Klein. Mr. Hekemian is the Chairman of the Executive
Committee. The Executive Committee is authorized to make policy and certain
business decisions during any interval between meetings of the Board of
Trustees. All decisions of the Executive Committee are reported to the Board of
Trustees on a regular basis. During fiscal 1999, the Executive Committee met six
(6) times.
(b) Audit Committee
The current members of the Audit Committee of the Board of Trustees
(the "Audit Committee") are Donald W. Barney, Alan L. Aufzien and Ronald J.
Artinian. Mr. Barney is the Chairman of the Audit Committee. The Audit Committee
held two (2) meetings during fiscal 1999. The Audit Committee selects and
recommends to the Board of Trustees the independent certified public accountants
to audit the books and accounts of the Trust. In addition, the Audit Committee
reviews and approves the scope and cost of all services (including non-audit
services) provided by the accounting firm selected to conduct the audit. The
Audit Committee also monitors the effectiveness of the audit effort and
financial reporting and inquires into the adequacy of the Trust's financial and
operating controls.
(c) Nominating Committee
In addition to the two standing committees referred to above, the Board
of Trustees, at its January 19, 2000 meeting selected Robert S. Hekemian, Donald
W. Barney, and Alan L. Aufzien to serve on an ad hoc Nominating Committee to
recommend to the Board the Trustees to be nominated for election at the Annual
Meeting.
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<PAGE>
Executive Compensation
The following table sets forth information concerning the compensation
of all of the Executive Officers of the Trust for services in all capacities to
the Trust for the fiscal years ended October 31, 1999, 1998 and 1997. Except for
the Chairman of the Board who devotes approximately twenty-five percent (25%) of
his business activities to the Trust, no other Executive Officer devotes more
than ten percent (10%) of his business activities to the Trust. No Executive
Officer of the Trust was compensated by the Trust in fiscal 1999, or in any
previous fiscal year, in an amount in excess of $100,000.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Annual Long-Term
Compensation Compensation
------------ ------------
Securities Underlying All Other
Name and Principal Position Year Retainer Fee ($)(1) Options (#) Compensation ($)(2)
- --------------------------- ---- ------------------- ----------- -------------------
<S> <C> <C> <C>
Robert S. Hekemian 1999 $ 7,000 -- $ 8,900
Chairman of the Board 1998 5,000 28,000 12,700
1997 5,000 -- 11,500
Donald W. Barney 1999 7,000 -- 19,100
President 1998 5,000 28,000 12,100
1997 5,000 -- 12,300
John B. Voskian, M.D. 1999 0 -- 10,900
Secretary 1998 0 16,000 8,500
1997 0 -- 7,100
William R. DeLorenzo, Jr. Esq. 1999 14,000 -- 10,500
Executive Secretary and 1998 10,500 13,000 7,000
Treasurer 1997 10,500 -- 6,400
- --------------------------
</TABLE>
(1) Retainer fee represents payment to the Executive Officers for their
services as an Executive Officer of the Trust.
(2) With respect to Mr. Hekemian and Mr. Barney such amounts represent annual
retainer fees, Board of Trustees' Meeting Fees, and other fees paid to each
of them as consideration for their service on the Board of Trustees and, if
applicable, the Executive Committee and the Audit Committee. With respect
to Mr. DeLorenzo, such amounts represent fees paid to him for his
attendance, as a nonvoting member, at the meetings of the Board of Trustees
and at meetings of the Executive Committee and Audit Committee. See section
of this Proxy Statement captioned "Trustees' Compensation."
In fiscal 1999, an annual retainer of $7,000 was paid to Mr. Hekemian,
Mr. Barney and Mr. DeLorenzo for their services as Executive Officers of the
Trust. Mr. DeLorenzo also received a $7,000 retainer for services rendered to
the Board of Trustees and its Executive Committee and Audit Committee. Except
<PAGE>
for the options which were granted, in fiscal year 1998, to the Executive
Officers, the Trust has not made available or paid any other compensation or
benefits to its Executive Officers, whether it be in the form of bonus,
long-term incentive or deferred compensation, perquisites, rights, warrants,
convertible securities, performance units, performance shares or other similar
instruments. There are no employment contracts between the Trust and any of the
Executive Officers, nor is there any compensatory plan or arrangement between
the Trust and any of the Executive Officers pursuant to which an Executive
Officer would receive payments as the result of his resignation, retirement or
any other terminating event, or as a result of a change in control of the Trust.
The Trust does not maintain any employee benefit plans.
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<PAGE>
Fiscal Year-End Option Values
The following table shows certain information regarding the fiscal
year-end values of the options held by each of the Executive Officers of the
Trust. No options were exercised during fiscal year 1999.
<TABLE>
<CAPTION>
Number of Securities Value of Unexercised
Underlying Unexercised In-The-Money Options
Options at Fiscal Year-End (#) at Fiscal Year-End ($)(2)
------------------------------ -------------------------
Name Exercisable (1) Unexercisable Exercisable Unexercisable
- ---- --------------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
Robert S. Hekemian 28,000 -- -- --
Donald W. Barney 28,000 -- -- --
John B. Voskian, M.D 16,000 -- -- --
William R. DeLorenzo, 13,000 -- -- --
Jr., Esq
</TABLE>
(1) All of the options as set forth in this table are currently exercisable.
(2) The value of unexercised in-the-money options represents the difference
between an option's exercise price and the fair market value of the Shares
on October 31, 1999 ($30 per Share). None of the options disclosed in this
table were in-the-money on October 31, 1999, since the exercise price for
all of these options is $30. The actual value, if any, an Executive Officer
may realize upon the exercise of an option will depend upon the excess of
the fair market value of the Shares over the exercise price on the date the
option is exercised.
Trustees' Compensation
In fiscal 1999, each Trustee received an annual retainer fee in the
amount of $7,000 and a fee of $600 for each meeting of the Board of Trustees or
of the Executive Committee or Audit Committee attended. Mr. DeLorenzo, the
Executive Secretary, receives the same meeting fee for each such meeting he
attends. The Chairmen of the Executive Committee and the Audit Committee receive
a $700 meeting fee for each meeting attended. In addition, the Trust pays a fee
in the amount of $600 to any Trustee and the Executive Secretary for visiting a
site to inspect a property being reviewed by the Trust, and will also reimburse
all actual and reasonable out-of-pocket expenses incurred in connection with
each such site visit. In the fiscal year ended October 31, 1999, the Trust paid
total fees of $154,200 to the Trustees and Mr. DeLorenzo as consideration for
their service with respect to the Board of Trustees and the Executive Committee
and Audit Committee. For fiscal 2000, the annual retainer paid to Trustees will
remain at the level stated above.
Compensation Report
The full Board of Trustees determines the amounts of the annual
retainer and meeting fees paid to the Executive Officers and Trustees. As set
forth in the "Summary Compensation Table" included in this Proxy Statement, the
Executive Officers receive only a nominal retainer fee as annual compensation
for their services as Executive Officers of the Trust. The Board of Trustees
believes that the amounts of the retainer fees paid to the Executive Officers
are reasonable, based on the amount of the time devoted by each of them in
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<PAGE>
executing their duties as Executive Officers and since the operation of the
Trust's business has been managed principally by Hekemian & Co., which received
fees and commissions in consideration for its services. See the section of this
Proxy Statement captioned "Certain Relationships and Related Party
Transactions."
Board of Trustees' members are:
Robert S. Hekemian Nicholas A. Laganella
Donald W. Barney Ronald J. Artinian
John B. Voskian, M.D. Alan L. Aufzien
Herbert C. Klein, Esq.
Performance Graph
The graph below compares the cumulative total return on the Shares for
the period covering the five fiscal years ended October 31, 1999 with the
performance of the Russell 2000(R) Index and the NAREIT Equity REIT Index. The
graph assumes that $100 was invested on October 31, 1994 in the Trust's Shares,
the Russell 2000(R) Index, and the NAREIT Equity REIT Index, and that all
dividends were reinvested.
[Graphic - Graph plotted to points listed below]
<TABLE>
<CAPTION>
Cumulative Total Return
----------------------------------------
10/94 10/95 10/96 10/97 10/98 10/99
<S> <C> <C> <C> <C> <C> <C>
FIRST REAL ESTATE INVESTMENT TRUST OF NEW JERSEY 100 104 113 141 182 183
RUSSELL 2000 100 118 138 179 161 174
NAREIT EQUITY 100 112 140 186 162 151
</TABLE>
Certain Relationships and Related Party Transactions
Mr. Hekemian and his sons, Robert S. Hekemian, Jr., Bryan S. Hekemian
and David B. Hekemian are the sole shareholders of Hekemian and Co. During
fiscal year 1999, all of the issued and outstanding shares held by Samuel P.
Hekemian, the brother of Robert S. Hekemian, and his two sisters, Marilyn
Voskian and Ann Krikorian, were purchased by Robert S. Hekemian, Robert S.
Hekemian, Jr., Bryan S. Hekemian and David B. Hekemian. As a result, Robert S.
Hekemian holds a 67% interest in Hekemian & Co.; the balance of the interest in
Hekemian & Co. is held by Robert S. Hekemian, Jr., Bryan S. Hekemian and David
B. Hekemian. As a result of the purchase of stock interest described, Hekemian &
Co., Inc. will continue to serve as the Trust's Managing Agents.
Pursuant to the terms of the Management Agreement, dated December 20,
1961, between Hekemian & Co. and the Trust, as amended (the "Management
Agreement"), Hekemian & Co. serves as the managing agent for the Trust's
properties. Robert S. Hekemian, Chairman of the Board of Trustees of the Trust,
is currently the Chairman of the Board of Hekemian & Co. The following family
members of Robert S. Hekemian are also officers of Hekemian & Co. and serve in
the positions set forth opposite their names.
Robert S. Hekemian, Jr. (son) - Executive Vice President
Bryan S. Hekemian (son) - Vice President and Secretary
David B. Hekemian (son) - Vice President and Treasurer
Serge Krikorian (brother-in-law) - Vice President-Insurance Department
Pursuant to the terms of the Management Agreement, the Trust pays
Hekemian & Co. fees based on a percentage of rents collected as compensation for
its management services. The Trust also reimburses Hekemian & Co. for the
salaries, payroll taxes, insurance costs and certain other costs of personnel
employed at the Trust's properties by Hekemian & Co. on behalf of the Trust.
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<PAGE>
From time to time, the Trust engages Hekemian & Co. to provide certain
additional services, such as consulting services related to development and
financing activities of the Trust. Separate fee arrangements are negotiated
between Hekemian & Co. and the Trust with respect to such services.
During the fiscal year ended October 31, 1999, the management fees paid
by the Trust to Hekemian & Co. were approximately $668,900 plus an office
overhead fee of approximately $69,679. In addition, the Trust paid Hekemian &
Co. approximately $135,640 in fees and commissions for the services provided by
Hekemian & Co. during fiscal year 1999 in the form of leasing commissions and
mortgage placement fees.
Robert S. Hekemian serves on the Board of Directors of Summit Bank. The
Trust has an $8 million line of credit with Summit Bank which is scheduled to
expire on March 1, 2000. As of February 23, 2000, the Trust did not have any
outstanding borrowings under the Summit Bank credit facility. The Trust's
Franklin Crossing retail property in Franklin Lakes, New Jersey, and its
residential apartment properties located in Lakewood, Palisades Park and
Hasbrouck Heights, New Jersey serve as collateral for the Summit Bank credit
facility. In connection with the Trust's $10.9 million purchase of the
Patchogue, New York retail property in December 1997, the Trust obtained a $7.5
million mortgage loan from Summit Bank to finance a portion of the purchase
price. The mortgage loan is payable in monthly installments of $54,816 including
interest at an annual rate of 7.375% through January 2005 at which time the
outstanding balance is due. The mortgage loan is secured by the Patchogue, New
York retail property. In addition, the Trust pays Summit Bank fees which are
customary for these types of loans.
The law firm of Nowell Amoroso Klein Bierman, P.A. was retained by the
Trust during fiscal 1999 to furnish legal services and received $10,431.00 in
fees from the Trust for its services. Mr. Klein and Mr. DeLorenzo are partners
in the law firm.
The Trust believes that the terms of the foregoing transactions are
consistent with the usual trade terms for other transactions with unaffiliated
parties in the ordinary course of business.
The Trust owns a forty percent (40%) membership interest in Westwood
Hills, LLC ("Westwood Hills") which is the owner of a 210 unit residential
apartment complex in Westwood, New Jersey. In addition, certain Trustees (Robert
S. Hekemian, Donald W. Barney, Herbert C. Klein, Esq. and Ronald J. Artinian)
and members of the immediate families of certain Trustees (Robert S. Hekemian,
John B. Voskian, M.D. and Herbert C. Klein, Esq.) beneficially own thirty-eight
percent (38%) of the remaining membership interests in Westwood Hills. Pursuant
to the terms of an operating agreement, the Trust is the managing member of
Westwood Hills. Hekemian & Co. currently serves as the managing agent for
Westwood Hills. During fiscal 1999, Westwood Hills paid approximately
$146,496.00 in management fees to Hekemian & Co. During the first quarter of
fiscal 1999, Westwood Hills completed a refinancing of its outstanding mortgage
debt, yielding net proceeds of approximately $4.9 million. Pursuant to its 40%
equity investment in Westwood Hills, the Trust received a $2 million
distribution out of such proceeds. In connection with the refinancing, Robert S.
Hekemian was required to provide a personal guarantee in certain limited
circumstances. The Trust and all other members of Westwood Hills have agreed to
indemnify Mr. Hekemian with respect to this guaranty.
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<PAGE>
OTHER MATTERS
The Board of Trustees does not know of any other business which will be
presented for consideration at the Annual Meeting. Except as the Board of
Trustees may otherwise permit, only the business set forth and discussed in the
Notice of Meeting and this Proxy Statement may be acted on at the Annual
Meeting. If any other business incident to the Annual Meeting is properly
presented at the Annual Meeting, or any adjournment thereof, the proxy holders
will vote in regard thereto according to their discretion insofar as such
proxies are not limited to the contrary.
RELATIONSHIP WITH INDEPENDENT ACCOUNTANTS
Selection of the independent public accountants for the Trust is made
by the Board of Trustees and is based upon the recommendation of the Audit
Committee. J.H. Cohn L.L.P. ("J.H. Cohn") has been selected as the Trust's
independent public accountants for the current fiscal year. J.H. Cohn has
audited the books, records and accounts of the Trust since 1991 and has provided
both audit and nonaudit services to the Trust. Audit services include: (i)
regular examination of the Trust's financial statements, including work relating
to quarterly reviews, SEC filings, and consultation on accounting and financial
reporting matters, and (ii) audit of specific financial and statistical
information. Nonaudit services include income tax consultation and systems
consultation projects. All audit and nonaudit services provided by J.H. Cohn are
approved by the Audit Committee which gives due consideration to the potential
impact of nonaudit services on auditor independence.
Representatives of J.H. Cohn will be present at the Annual Meeting and
will have an opportunity to make a statement if the representatives desire to do
so and will be available to respond to appropriate questions.
ANNUAL REPORT
The Annual Report to Shareholders (the "Annual Report") for the fiscal
year ended October 31, 1999 accompanies this Proxy Statement. J.H. Cohn has
audited the financial statements of the Trust for the fiscal year ended October
31, 1999, which financial statements are contained in the Annual Report. Such
Annual Report, including the audited financial statements contained therein, is
not incorporated in this Proxy Statement and is not deemed to be part of the
proxy soliciting material.
COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT
Section 16(a) of the Exchange Act requires the Trust's Executive
Officers and Trustees, and persons who own more than ten percent of the Shares,
to file reports of ownership and changes in ownership on Forms 3, 4 and 5 with
the Securities and Exchange Commission ("SEC"). Executive Officers, Trustees and
greater than ten percent shareholders are required by SEC regulation to furnish
the Trust with copies of all Forms 3, 4 and 5 they file.
Based solely on the Trust's review of the copies of such forms it has
received, the Trust believes that all of its Trustees, Executive Officers and
greater than ten percent beneficial owners complied with all filing requirements
applicable to them with respect to reports required to be filed by Section 16(a)
of the Exchange Act during fiscal 1999, except as follows:
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<PAGE>
During fiscal year 1999, Ronald J. Artinian, a Trustee, purchased 1,000
shares of the Trust in the open market for his own account. Mr. Artinian did not
file a Form 4 in a timely manner due to inadvertence. Mr. Artinian did, however,
file a Form 4 with the SEC prior to the end of the Trust's fiscal year.
During January 2000, a Form 5 was filed by each Officer and Trustee to
report the number of stock options granted by the Board of Trustees in 1998.
SHAREHOLDER PROPOSALS
Shareholder proposals for presentation at the Trust's next annual
meeting must be received by the Trust at its principal executive offices for
inclusion in its Proxy Statement and form of proxy relating to that meeting no
later than October 31, 2000.
THE BOARD OF TRUSTEES OF THE TRUST RECOMMENDS THAT THE SHAREHOLDERS
VOTE IN FAVOR OF THE NOMINEES TO THE BOARD OF TRUSTEES.
THE TRUST SUBMITS TO THE SECURITIES AND EXCHANGE COMMISSION AN ANNUAL
REPORT ON FORM 10-K. COPIES OF THE REPORT WILL BE FURNISHED WITHOUT CHARGE UPON
WRITTEN REQUEST RECEIVED FROM ANY HOLDER OF RECORD OR BENEFICIAL OWNER OF SHARES
OF THE TRUST. REQUESTS SHOULD BE DIRECTED TO SHAREHOLDER RELATIONS, FIRST REAL
ESTATE INVESTMENT TRUST OF NEW JERSEY, 505 MAIN STREET, P.O. BOX 667,
HACKENSACK, NEW JERSEY 07602.
ALL SHAREHOLDERS ARE URGED TO MARK, SIGN, DATE AND SEND THEIR PROXIES
WITHOUT DELAY TO REGISTRAR AND TRANSFER COMPANY, 10 COMMERCE DRIVE, CRANFORD,
NEW JERSEY 07016. PROMPT RESPONSE IS HELPFUL AND YOUR COOPERATION WILL BE
APPRECIATED.
/s/William R. DeLorenzo, Jr.,
-----------------------------
William R. DeLorenzo, Jr.,
Executive Secretary
February 23, 2000
<PAGE>
REVOCABLE PROXY
First Real Estate Investment Trust of New Jersey
[ X ] PLEASE MARK VOTES AS IN THIS EXAMPLE
Annual Meeting of Holders of Shares of
Beneficial Interest - April 12, 2000
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES
The undersigned hereby nominates and appoints Robert S. Hekemian and
William R. DeLorenzo, Jr., Esq., and each of them, the true and lawful
attorneys, agents and proxies of the undersigned, with full power of
substitution, to vote with respect to all of the shares, representing beneficial
interests, of FIRST REAL ESTATE INVESTMENT TRUST OF NEW JERSEY standing in the
name of the undersigned at the close of business on February 23, 2000, at the
annual meeting of holders of shares of beneficial interest to be held at the
Trust's headquarters, 505 Main Street, Hackensack, New Jersey 07601, on April
12, 2000 at 7:30 p.m., and at any and all adjournment or adjournments thereof,
with all powers that the undersigned would possess if personally present and
especially (but without limiting the general authorization and power hereby
given) to vote as indicated hereon.
1. ELECTION OF TRUSTEE:
Herbert C. Klein
[ ] FOR [ ] WITHHOLD
2. In their discretion upon such other matters as may properly come before the
meeting or any adjournment or adjournments thereof.
The shares represented by this Proxy will be voted in the manner directed, and
if no instructions to the contrary are indicated, will be voted FOR the election
of the nominee indicated on this Proxy.
IMPORTANT: Please sign exactly as your name appears. When signing as attorney,
executor, administrator, trustee or guardian, please set forth your full title.
If signer is a corporation, please sign the full corporate name by a duly
authorized officer. Joint owners should each sign.
Please be sure to sign and date this Proxy in the box below.
_________________________________________
Date
_________________________________________
Stockholder sign above
_________________________________________
Co-holder (if any) sign above
Detach above card, sign, date and mail in postage paid envelope provided.
FIRST REAL ESTATE INVESTMENT TRUST OF NEW JERSEY
PLEASE ACT PROMPTLY
SIGN, DATE & MAIL YOUR PROXY CARD TODAY
